NCPA advocates for Iowa drug pricing transparency bill

March 14, 2014

The National Community Pharmacists Association is asking Iowa’s Gov. Terry Branstad to sign into law H.F. 2297 legislation that would provide a level of transparency for how pharmacy benefit managers (PBMs) determine reimbursement for multiple source generic drugs. The legislation would give the insurance commissioner authority to request information from PBMs in Iowa, according to a March 11 letter from NCPA to the governor.

The National Community Pharmacists Association is asking Iowa’s Gov. Terry Branstad to sign into law H.F. 2297 legislation that would provide a level of transparency for how pharmacy benefit managers (PBMs) determine reimbursement for multiple source generic drugs.

The legislation would give the insurance commissioner authority to request information from PBMs in Iowa, according to a March 11 letter from NCPA to the governor.

More than 300 community pharmacies that employ about 3,400 full-time workers would be affected by this law.

“H.F. 2297 should give independent community pharmacists some basic insights into their reimbursement from PBMs for common generic drugs, as well as set forth an appeals process to hopefully resolve differences that may emerge if PBMs continue to reimburse community pharmacies at lower, outdated rates when in fact drug acquisition costs increase significantly for pharmacies,” said NCPA CEO B. Douglas Hoey, RPh, MBA. “We encourage Gov. Branstad to sign this legislation into law. NCPA is proud to support the efforts of Iowa’s independent community pharmacies on this issue.”

NCPA explained that independent pharmacies are usually offered take-it-or-leave-it contracts from PBMs who represent health insurance plans. Pharmacists don’t know how reimbursement caps, known as maximum allowable costs (MACs), are determined for common generic drugs, which make up 80% of the drugs that they dispense.

There are six other states that have enacted MAC legislation in the past two years and another 12 have proposals that are being evaluated, NCPA said.